Transport Committee on April 4th, 2022

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

I have a follow-up question, but first, Mr. Gooch, do you want to make a comment on that question?

[Daniel-Robert Gooch]

Yes, thank you. I don't have a lot to add. I will say that digitalization and better visibility as to what's moving through ports are very important for Canada's port authorities. Certainly, greater knowledge about what's going on in the port helps, and knowledge about the routes leading up to and leaving the ports is certainly very valuable for improving the efficiency of operations in our supply chain overall.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Just as a follow-up question, to Mr. Masterson or any of the others, would your organization or member companies in your organization be willing to share proprietary data with the aim of improving the fluidity of our supply chains, and if so, under what conditions? Is there some kind of information you would insist on keeping confidential?

[Bob Masterson]

Kara, I'll pass it to you. I have some quick answers, but you get the specifics.

[Kara Edwards]

Sure. We'd really need to explore what that would look like. Generally, companies are a little bit hesitant to share information regarding pricing and rates, as well as regarding potentially confidential relationships between their suppliers and their customers.

We'd definitely be open to having that conversation to see what we could do, and we are very supportive of having a more transparent information system within the supply chain.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thank you.

[Bob Masterson]

That said, certainly our industry is always providing information to government, and there are procedures to do that to protect confidential business information. Anything we can provide that will strengthen the transportation system and improve the relationship between the rights of shippers and those of carriers we will gladly provide you under the correct protections for confidential business information. We do it all the time.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thank you.

I have a question for the Seafarers' group.

Mr. Given, how do you propose to increase the number of mariners in Canada? Are there things we could do short-term to address worker shortages?

[Chris Given]

This is an excellent question.

Right now, worker shortages are definitely an issue, but we need to differentiate between the shortages that exist. We have two different classes of employees on vessels: licensed and unlicensed. Licensed employees include officers and engineers, and that's really where we find the shortage.

The situation in Canada is exactly the same as the situation globally. It's actually worse globally. Basically, the international associations have taken a survey of this, and the labour report for last year indicated that there was a shortage of 28,000 officers worldwide and there was a surplus of 30,000 ratings worldwide, which really draws attention to the fact that we have mariners in the system—and it's the same situation in Canada—and we just need to work on training those mariners to occupy those higher ranks and those higher levels. I think that involves working with the companies, but it also involves securing funding for training and different things that we can work on with the government in the future.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Given.

Thank you very much, Mr. Rogers.

Next we have Ms. Gladu.

Ms. Gladu, the floor is yours. You have five minutes.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Thank you, Chair.

I'll start by talking about the bureaucracy. Many of you, when you were talking about what we need to do in the supply chain, mentioned some things. The port mentioned financing, borrowing limits and allowing commercial lenders. Could I ask all of the witnesses, please, to submit specific things that the government needs to do to reduce bureaucracy? If you could submit them to the clerk, then they could be included in our study. That would be really good.

The next question is for Bob Masterson.

You talked about where we have rail constraints. Could you describe a bit more where those constraints are and what solutions you'd like to see?

[Bob Masterson]

The question came up earlier, “What about the next five to 10 years?” That's not really the issue. We're trying to attract investments in facilities that need to produce for the next 40 years. I will come back to what I mentioned earlier about Canada's stated population goals. We're talking about two and a half times the population over the next several decades, and two and a half times the economic activity, at least; hopefully, it will be more.

Think of the places where we're struggling now. We were once, and still are, major resource exporters. We process more of it now, but we're still major resource exporters. That was fine when the people in our cities, where our major ports and rail lines were contained, had a stake in that activity. They were direct participants. That's no longer the case.

Picture Vancouver growing two and a half times over the next several decades. Do we really think we're going to move two and a half times the rail freight traffic through there? I don't think so. What about Halifax? I don't think so. What about Montreal? I don't think so. What about Toronto? I don't think so. Again, we would challenge you, or call on you as a committee, to think about Canada's long-term economic and population objectives. Where are we going to put these ports? Where are we going to build the resiliency?

The work we're doing today.... There has been a lot of talk today about de-bottlenecking and getting some better efficiencies out of what we have today. Of course, that's terribly important, but we need to make sure that we're going to have the ability to move product out of this country for the next 40 or 50 years. Those are the investments that are being made today.

We think we have to turn our sights away from just focusing on some of these major cities, where we're already seeing the constraints between populations that don't have a tie to this activity and what we're going to need to do today and in the future. Pick any major city, especially the Lower Mainland through to Vancouver. It is terribly constrained when it comes to moving our goods.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Thank you.

One idea that was suggested in previous testimony was that we need to develop more international ports from some of the ports that exist. For example, Sarnia—Lambton could be an international port. It's on the Great Lakes waterway. There are numerous other ones. This would help with growth capacity, as well as resiliency on constraints.

Would you agree that this is a good idea?

[Bob Masterson]

Is the question directed to me?

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

I'm going to direct this question to you, and then to Mr. Gooch.

[Bob Masterson]

There are definitely opportunities. Every customer and every shipper is different. What I would say, again, is that when you think about Canada's chemistry sector, we largely ship in the United States, so enhanced movement across the Great Lakes could be helpful. However, the future is really Asia. Now, with recent issues in Europe, everybody is looking at what the future of Europe looks like, but we're talking about ocean-going.

As a nation, we are less productive when we have to handle things multiple times. We're already hampered, if you think about where much of our industry is in western Canada. We already have to go over the mountains and down to the coast. The more times things are handled, the more costs there are and the less competitive Canadian businesses are.

The answer has to be to focus on the railway system, which moves most of our commodity goods, and the sea-based assets that will help get them to global markets, where the populations are. There's definitely movement in the Great Lakes, but the big picture is the seafaring ports.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Very good.

Mr. Gooch, what do you think about this idea of developing more international ports from the ports that exist across the country?

[Daniel-Robert Gooch]

We see ports that see opportunities to provide more services. I look to the Great Lakes, for example. The 2019 report by your predecessors in this committee listed greater use of the St. Lawrence Seaway as the number one recommendation. Of course, this entails working with our partners, including our partners within the federal family and CBSA, to ensure that adequate resources are available, both for any ports that want to aspire to receive international traffic and for those existing ports that need those CBSA services as well.

There are opportunities there, but they need to be examined against all of that.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Excellent.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Gooch.

Thank you very much, Ms. Gladu.

Next we have Ms. Koutrakis.

The floor is yours. You have five minutes.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you, Mr. Chair.

Thank you to all our witnesses for being with us today.

My next questions will be addressed to Mr. Dekovic at GCT.

I understand that the shortage of containers—we have talked about it a lot this morning and this afternoon—is one of the major causes of problems with global supply chains. Do you see this shortage as a temporary problem, or a potentially longer-term structural challenge?

[Marko Dekovic]

Thank you for that question.

I would say it's a short-term challenge.

As I mentioned in my testimony, the number of full containers moving out of our ports was down by 2%, but probably there was about a 50% increase in empty containers moving out. That is due to the imbalance in the supply chain. The empty containers are being more rapidly evacuated back to Asia due to the growing consumer demand surge. That kind of volume is being sucked up that way. That will return back to normal as the supply chain normalizes.

On Canada's west coast, we actually have a pretty balanced trade compared to other North American ports, which are much more import ports only. We do export in containers. Our terminals handle exports of lumber, specialty crops and other items, so it's pretty balanced.

I would say it's short-term. We can probably see some stabilization coming later this year in that balance.

[Annie Koutrakis, Liberal, Vimy, QC]

Do you think manufacturing could be a solution? Is this something that can be done in Canada to address some of this shortage? If so, how long do you think it would take to increase the supply on a scale large enough to address the shortage?

[Marko Dekovic]

Are you talking about—

[Annie Koutrakis, Liberal, Vimy, QC]

If we were to manufacture them in Canada, is that something you think is possible?